Business Context and Reporting Period
Company: Bridgford Foods Corporation (BRID)
Filing Type: Form 10-Q (Quarterly Report)
Reporting Period: Twelve and twenty-four weeks ended April 17, 2026 (Fiscal Q2 2026)
Business Overview: The Company operates two segments: Frozen Food Products (biscuits, dough items) and Snack Food Products (meat snacks, jerky). It is classified as a non-accelerated filer and a smaller reporting company.
Key Financial Metrics
| Metric | 12 Weeks Ended April 17, 2026 |
24 Weeks Ended April 17, 2026 |
12 Weeks Ended April 18, 2025 |
24 Weeks Ended April 18, 2025 |
|---|---|---|---|---|
| Net Sales | $50,044 | $105,356 | $50,639 | $103,184 |
| Gross Margin | $8,781 (17.5%) | $22,150 (21.0%) | $11,071 (21.9%) | $23,956 (23.2%) |
| Operating Loss | $(5,845) | $(7,078) | $(3,187) | $(5,198) |
| Net Loss | $(4,924) | $(5,767) | $(3,860) | $(4,973) |
| EPS (Basic & Diluted) | $(0.54) | $(0.64) | $(0.43) | $(0.55) |
| Cash & Equivalents | $830 (as of April 17, 2026) | |||
| Total Debt | $6,586 (as of April 17, 2026) | |||
| Working Capital | $37,423 (as of April 17, 2026) |
Note: All figures in thousands except per share data.
Material Changes vs. Prior Period
- Revenue: Net sales decreased 1.3% ($595) for the quarter but increased 2.1% ($2,172) for the year-to-date period. The decline in the quarter was driven by a 7.5% drop in unit sales volume, partially offset by a 9.0% increase in selling price per pound.
- Profitability: Gross margins contracted significantly, falling from 21.9% to 17.5% in the quarter. This was primarily due to a $2,306 increase in meat commodity costs within the Snack Food segment and higher overhead expenses (healthcare, repairs) in the Frozen Food segment.
- Operating Expenses: SG&A expenses increased 2.5% ($364) for the quarter, driven by higher insurance premiums, outside consulting fees, and healthcare costs, partially offset by reduced storage unit costs due to route reorganization.
- Cash Flow: Net cash used in operating activities improved significantly to $(1,813) for the 24-week period compared to $(5,426) in the prior year, aided by a reduction in accounts receivable and lower promotional allowances.
Outlook, Risks, and Management Commentary
- Liquidity Concerns: Management notes recurring losses and negative operating cash flows. As of April 17, 2026, the Company had $830 in cash and $4,250 available under its revolving credit facility. Subsequent to the period end (as of June 1, 2026), the Company borrowed an additional $2,750, leaving only $1,500 available.
- Covenant Violations: The Company was in violation of the net income and quick ratio covenants under its Wells Fargo credit agreement as of April 17, 2026. These breaches were waived by the lender via letter dated May 28, 2026.
- Strategic Initiatives: The Company is reorganizing its direct-store-delivery system to reduce costs, implementing price increases to offset commodity inflation, and expanding private-label production to capture value-conscious consumers.
- Risk Factors: Significant risks include volatility in meat and flour commodity prices, potential tariffs, inflationary pressures on labor and freight, and the ability to pass cost increases to customers without losing volume.
Investor Verification Checklist
- Covenant Compliance: Verify the status of the waived covenants and the Company's ability to meet future financial requirements under the Wells Fargo credit agreement.
- Liquidity Runway: Assess the sufficiency of the remaining $1,500 credit facility availability and cash on hand to fund operations given the recurring net losses.
- Commodity Exposure: Monitor meat and flour price trends and the Company's ability to maintain margins despite rising input costs.
- Customer Concentration: Note that Walmart and Dollar General represent significant portions of sales (28.6% and 15.4% respectively for the 24-week period) and accounts receivable.
- Inventory Valuation: Review the $1,224 reserve for slow-moving/obsolete inventory and the $463 net realizable value reserve on meat products.